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Do you plan 100% exact inventory vis-a-vis Sales or you have to over-estimate? If yes, what should be a realistic percentage of over-estimation?

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Question added by Shamsi Khan , General Manager Supply Chain, Procurement & Operations , Oyster Group (MBK & MFK)
Date Posted: 2013/12/30
Anurag Singh
by Anurag Singh , Graduate Engineering Apprentice , Bosch Limited (Robert Bosch India)

The answer to this depends on how stable is your customer demand and are their any quality losses?

If the customer demand is not stable then depending on your past customer and market behaviour(past1 months) you will have to maintain a safe inventory to meet the customer demand.

Also if your process produces quality losses then you need to also account for these losses in your safety inventory.

The percentage can vary between different organisations

 

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